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  • Magic New Retail in China, Go to Market or Hell?

    Post by : expatree

One stone can make waves. Recently one explosive news were headlined by different Chinese Medias and the news spread out rapidly amongst the Chinese people. It’s officially announced that Alibaba group hands with Bailian retail group to consolidate data integration from online to offline, in means that the first step is to penetrate Chinese physical retail industry with a perspective ambition.
 
Influenced by “Amazon Go” self-service supermarket rising up, Chinese physical retail is exploring a road of innovation, meanwhile trying to get rid of a negative effect of e-commerce flourish. Coincidentally Chinese government shows a strong signal, the State Counsel has issued a bulletin in November 2016 aimed at fostering the New Retail in China, with the emphasis of customer experience innovations and integrated on-line and off-line services.
 
However all of us has to face a big question of how it should look like in “New Retail”? With no doubt this not simply copy “e-commerce” model to physical retail, especially discount strategy; but also “online order + offline experience” kind of traditional O2O strategy has gone away. As the recent KPMG 2016 Consumer Executive Survey highlights, more than 70% of Retail Executives aim to achieve a seamless or fully integrated Omni channel business model by 2018.

To our opinion, no matter “Seamless integration” or “Omni channel”, the key optimization is to solve consumer issues happened in physical store scenarios. For example of hypermarket case, “Queuing for payment is tiresome and time consuming” or “Indecision due to overwhelming choice with no clear information” etc. the reason why we frequently hear these voice of complaint because consumer prefers to make a comparison with e-commerce benchmark, 30.7% think “save time” as well as 52.3% think “Ability to compare prices” are two of major advantages which physical store cannot offer, according to a survey result. 

 
In principle Omni-channel points at data manipulation in backend system, in-store user experience enhancement should be separated from online behavior by in-store digitalized technology. This becomes a new value-added shopping environment.” Commented by Expatree founder, Gordon

A variety of retail industries shall own an unique and independent in-store solution, but most of them encounter several big challenges to approach their target. Technically it is required to evolve the IT landscape and embed digital capabilities and getting rid of the complex, inflexible and costly 10-years-old legacy systems. Key is the selection of the right partner in this journey.
 
In business strategy traditional retail focuses too much on product “HARD PUSH” delivering to consumers rather than personalized interaction. If we cannot put ourselves on the shoes of consumers, no matter how fancy solution is, it just goes to a wrong direction from the beginning.
 
Last but not least “A new value-added solution” means innovative changes will happen in all aspects of company’s units, we fully understand someone is afraid of “changes” because it results in a part of something uncertain, or cannot completely adopt a new way of working. This asks C-level decision maker to constantly optimize the solution with a strength of leadership.  

"Amazon Go" Promo Video
Date:2017-03-22 15:30:56
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